Correlation Between Carillon Chartwell and Scout Core

Can any of the company-specific risk be diversified away by investing in both Carillon Chartwell and Scout Core at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Carillon Chartwell and Scout Core into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Carillon Chartwell Mid and Scout E Bond, you can compare the effects of market volatilities on Carillon Chartwell and Scout Core and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Carillon Chartwell with a short position of Scout Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Carillon Chartwell and Scout Core.

Diversification Opportunities for Carillon Chartwell and Scout Core

0.49

Correlation Coefficient

Carillon Chartwell  Scout Core

Very weak diversification

The 3 months correlation between Carillon and Scout is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Carillon Chartwell Mid and Scout E Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scout E Bond and Carillon Chartwell is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Carillon Chartwell Mid are associated (or correlated) with Scout Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scout E Bond has no effect on the direction of Carillon Chartwell i.e., Carillon Chartwell and Scout Core go up and down completely randomly.

Pair Corralation between Carillon Chartwell and Scout Core

Assuming the 90 days horizon Carillon Chartwell Mid is expected to under-perform the Scout Core. In addition to that, Carillon Chartwell is 4.96 times more volatile than Scout E Bond. It trades about -0.16 of its total potential returns per unit of risk. Scout E Bond is currently generating about 0.03 per unit of volatility. If you would invest  1,074  in Scout E Bond on November 28, 2024 and sell it today you would earn a total of  5.00  from holding Scout E Bond or generate 0.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.31%
Values	Daily Returns

Carillon Chartwell Mid  vs.  Scout E Bond

Carillon Chartwell Mid

Risk-Adjusted Performance

Very Weak

Over the last 90 days Carillon Chartwell Mid has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's fundamental indicators remain fairly strong which may send shares a bit higher in March 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Scout E Bond

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Scout E Bond are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Scout Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Carillon Chartwell and Scout Core

The main advantage of trading using opposite Carillon Chartwell and Scout Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Carillon Chartwell position performs unexpectedly, Scout Core can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Scout Core will offset losses from the drop in Scout Core's long position.

The idea behind Carillon Chartwell Mid and Scout E Bond pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.